{"id":610223,"date":"2025-12-03T20:30:11","date_gmt":"2025-12-03T20:30:11","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/610223\/"},"modified":"2025-12-03T20:30:11","modified_gmt":"2025-12-03T20:30:11","slug":"manchesters-hospitality-faces-a-unprecident-cocktail-of-challenges-as-sector-speaks-out","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/610223\/","title":{"rendered":"Manchester’s hospitality faces ‘a unprecident cocktail of challenges’ as sector speaks out"},"content":{"rendered":"

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The smell of fresh cooking drifts through the streets of Prestwich<\/a> as dinnertime approaches. Inside the Lime Tree, Johnny Gupta moves swiftly behind the counter, preparing dishes that have fed generations of Mancunians.<\/p>\n

Across the city in Manchester city centre, Mark Wrigley from Atlas Bar surveys his staff, balancing schedules with the sharp eye of someone who has run one of Manchester\u2019s most iconic bars for years. Both are seasoned hospitality operators, yet both say the sector is teetering on the edge.<\/p>\n

For decades, Manchester\u2019s restaurants, pubs, and bars have been community hubs, lifelines for staff, and destinations for locals and tourists alike. But today, the people who keep the city\u2019s hospitality sector alive are struggling with an unprecedented cocktail of challenges: rising labour costs, unpredictable business rates, inflationary pressures, and policy changes that seem to swing against them with little warning.<\/p>\n

Manchester\u2019s hospitality challenges<\/p>\n

\"\"Manchester\u2019s gorgeous Atlas Bar<\/p>\n

At Atlas Bar, Mark recounts the year-on-year pressures that have made running a pub a delicate balancing act. \u201cEmployment costs are a big worry,\u201d he says. \u201cThe extra costs forced us basically to reduce staffing levels. The employer National Insurance contribution, ENI, has gone up to 15%, and that meant we had to find an extra \u00a320,000 a year. That\u2019s double what ENI costs were the year before.\u201d<\/p>\n

And the strain isn\u2019t stopping there. With the National Minimum Wage rising again in 2026, Mark calculates that keeping his staff ahead of inflation will require another \u00a326,000. \u201cWe\u2019ve been forced to reduce expenditure where we can,\u201d he says, \u201cmainly on staff, but also on marketing, repairs, everything. If we hadn\u2019t, we would be insolvent by now.\u201d<\/p>\n

\"\"The Lime Tree, Prestwich<\/p>\n

At the Lime Tree in Prestwich, Johnny Gupta faces a similar dilemma. His business has operated for 17 years, serving authentic South Asian dishes at affordable prices. But the reality of staff costs is relentless. \u201cOut of \u00a36,500 in a week, \u00a32,500 goes on staff wages alone,\u201d he explains. \u201cThen you add VAT, utilities, rent, and food costs. By the time I\u2019ve paid everything, there\u2019s almost nothing left.\u201d<\/p>\n

Johnny\u2019s story illustrates a key tension: businesses want to remain ethical employers, paying staff fairly and legally, but the financial squeeze is narrowing that possibility. For many, it\u2019s not just a matter of profitability, it\u2019s survival.<\/p>\n

Business Rates: a ticking time bomb<\/p>\n

Employment costs are only half the story. Business rates, once seen as a predictable overhead, have become a source of near existential stress for hospitality owners. In 2025, Labour\u2019s reduction of rates relief from 70% to 40% left many operators scrambling.<\/p>\n

Mark describes the impact on Atlas Bar: \u201cIt was a large blow. We needed to find an extra \u00a315,000, more than double what we paid the year before.\u201d<\/p>\n

\"MarkMark Wrigley from Atlas Bar<\/p>\n

For 2026, the situation is set to worsen. Despite promises to overhaul the business rating system, Mark reports, \u201cThe VOA reassessed our property at \u00a397,000. That\u2019s a huge jump from the rent we agreed with our landlord, \u00a370,000 a year. No discussions, no transparency over where these numbers come from. Shocking.\u201d<\/p>\n

The mismatch between real-world costs and assessed rates is fuelling resentment. \u201cLabour is gaslighting the nation with their rhetoric,\u201d Mark says. \u201cThey are playing clever with numbers and percentages to create the illusion of support. The reality is, hundreds, maybe thousands, of hospitality venues are facing huge increases in their rates.\u201d<\/p>\n

Johnny Gupta echoes these concerns from a different angle. For his Prestwich restaurant, the reduction in relief in 2025 forced him to shoulder more than he had planned. \u201cWhen people hear a turnover of \u00a3400,000, they think it\u2019s easy money,\u201d he says. \u201cBut that turnover is not profit. Out of that \u00a3400k, I have to pay rent, gas, electricity, water, VAT, business rates, PAYE, national insurance, staff wages, food, insurance\u2026 the list goes on. By the time it\u2019s all paid, there\u2019s barely anything left.\u201d<\/p>\n

Johnny points out an uncomfortable truth: many less compliant businesses, takeaways operating cash-in-hand, some skirting VAT, appear more profitable simply because they evade the obligations that legitimate, law-abiding businesses shoulder. \u201cWhy should decent, hardworking people keep suffering while others work cash-only, avoid tax, employ illegal workers, or run criminal activity behind closed doors?\u201d he asks.<\/p>\n

Inflation, energy, and everyday costs<\/p>\n

Rising employment costs and business rates are compounded by inflation, which continues to affect everything from food prices to utilities. Mark notes that energy costs are up, a factor baked into both rent negotiations and daily operations. Johnny\u2019s experience reinforces this: \u201cWe used to sell chicken tikka masala for \u00a36 or \u00a37.<\/p>\n

\u201cNow it\u2019s just under \u00a315. I can\u2019t morally charge \u00a320\u201325 for a chicken dish. That would be unaffordable for my customers.\u201d<\/p>\n

The moral calculus of hospitality owners, balancing survival with ethical pricing, adds another layer of stress. Johnny emphasises that many operators like him have long histories in the city, families to support, and a sense of responsibility to their communities. \u201cWe\u2019ve always struggled with something or other,\u201d he said, \u201cbut with the blessing of our customers, we\u2019re still here. But we\u2019re running on fumes. We need support to keep going.\u201d<\/p>\n

The legacy of COVID and VAT policy<\/p>\n

The pandemic left deep scars across Manchester\u2019s hospitality sector, and the aftershocks are still being felt. During COVID, VAT was temporarily reduced to 5% for hospitality, providing a lifeline. But by 2021, it returned to 20%, making the UK one of the highest VAT countries in Europe.<\/p>\n

Johnny notes the irony: \u201cDuring COVID, every takeaway received \u00a310,000 in grants. Every single one. But restaurants like mine were closed. We couldn\u2019t earn, couldn\u2019t pay VAT. If the government had reduced VAT slightly or ensured takeaways complied, they\u2019d have collected more revenue. Instead, honest businesses like mine suffered disproportionately.\u201d<\/p>\n

Community, compliance, and the human toll<\/p>\n

\"AtlasBarista Nadine whipping up some top class coffee at Atlas Bar<\/p>\n

Beyond numbers, there is a human story behind these statistics. Mark talks about his staff at Atlas Bar, who remain engaged despite reduced hours and heightened pressures. Johnny speaks passionately about the community he serves in Prestwich, donating 5% of weekly turnover to local groups.<\/p>\n

But both acknowledge the emotional toll. Johnny\u2019s personal history, surviving abuse and navigating systemic challenges, fuels his resolve, but also underlines the stakes. \u201cI\u2019ve been doing everything by the book for 17 years,\u201d he says. \u201cBut now, after everything, I\u2019m at the end of my tether. If I close, ten staff lose their jobs, and Prestwich loses a reputable business.\u201d<\/p>\n

The stress is widespread. Mark warns that many businesses may not survive the cumulative impact of rising employment costs, business rates, and energy bills. \u201cThe council seriously needs to look at what they can do to mitigate the cliff edge of RVs for hospitality venues,\u201d he says. \u201cWe could be looking at a lot of closures under the weight of all this taxation.\u201d<\/p>\n

What the future holds<\/p>\n

\"\"The Lime Tree, Prestwich<\/p>\n

Both Mark and Johnny are pragmatic about the measures they must take to survive. Atlas Bar is planning to reduce trading hours to save money. The Lime Tree continues to operate with tight margins, carefully balancing pricing with ethics and customer loyalty.<\/p>\n

Yet there is a shared sentiment of frustration and betrayal. Promises of reform have not materialised. Costs continue to rise while support mechanisms appear designed more for optics than impact. Johnny sums it up: \u201cI really thought Labour would help. I don\u2019t want Reform to get in. I\u2019m not a politician, I\u2019m just someone who\u2019s survived a lot. But I feel compelled to speak up for all honest, compliant businesses.\u201d<\/p>\n

There is resilience, too. Both business owners emphasise community, staff loyalty, and the pride of operating a longstanding, legal, and reputable enterprise. But resilience alone may not be enough. Without substantive government intervention, reform of business rates, measured wage support, and energy relief, Manchester\u2019s hospitality sector could face a wave of closures that would reshape the city\u2019s social and economic landscape.<\/p>\n

A call to the government for fairness<\/p>\n

The experiences of Atlas Bar and the Lime Tree highlight a paradox at the heart of modern British hospitality: businesses that adhere to legal and ethical standards are being squeezed, while those that evade obligations can survive more easily. Rising costs, opaque rating systems, and inflation are not just financial pressures; they are existential threats.<\/p>\n

As Manchester prepares for another tough economic year, the question looms large: how many of its pubs, bars, and restaurants will survive without meaningful reform? For Mark, Johnny, and thousands of other operators across the city, the answer will determine whether Manchester\u2019s hospitality sector thrives, or simply survives.<\/p>\n

The city\u2019s heart, its vibrant streets and communities, relies on them. And without support, the doors of these establishments may close for good, taking with them not just meals and drinks, but livelihoods, too. <\/p>\n

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